When an eight-storey garment factory in Bangladesh collapsed in April 2013, more than 1,100 workers died in the rubble.
As news of the tragedy unfolded, survivors publicly talked about poor working conditions, dismal wages and unsafe buildings. Their stories shifted public and media attention to the clothing distributors, such as Loblaw’s Joe Fresh, which had signed contracts with overseas factories to produce their apparel.
For Sara Seck, the incident highlights the tension between “black letter law” and the social obligation of corporations – the difference between only doing what’s legal and doing what’s right.
“While many would argue that Loblaw is not legally liable for the consequences of the building collapse or the factory owner’s actions,” said Seck, associate professor at the Faculty of Law, “there’s a growing societal expectation that businesses will adhere to international standards through their supply chains, respecting the safety and human rights of workers.”
As for Loblaw, it pledged compensation for victims and committed to inspections of Bangladeshi garment factories. It also joined an industry coalition to advocate for improved building safety.
The Loblaw case study is one of many in Canada illustrating the link between corporate social responsibility (CSR) and business law. More than a decade ago, Talisman Energy faced fierce criticism of its investments in war-torn Sudan, which were eventually sold in 2003. Since then, the company has adopted CSR goals, including a human rights commitment, for its projects. In another example, the mining company HudBay is being sued for alleged human rights abuses and sexual violence attributed to security personnel near its former Guatemalan operations. The case is currently before Canadian courts.
These examples, said Seck, demonstrate a growing need to bridge business law with human rights, environmental and advocacy law. Traditionally, business law was solely concerned about the legal side of mergers and acquisitions, trade and finance. However, as a result of the UN’s Guiding Principles on Business and Human Rights in 2011, corporate leaders have a responsibility to develop and follow appropriate human rights policies.
“Up until 10 years ago, business lawyers looked at the ‘black letter law’ to advise clients of what they were legally obligated to do or not do,” said Seck. “But now, lawyers are increasingly realizing the importance of giving legal advice that is sensitive to the social context of corporate operations and that failing to do so has both financial and reputational costs for clients, as well as grave implications for those whose rights are violated.”
Yet, as a new and evolving presence within business law, CSR raises many unanswered questions for lawyers and their clients. “It’s an area of law that is moving so quickly that there’s a need to keep up with developments with ongoing research and analysis of its impact on legal education and practice,” said Seck.
With its strong reputation for business law in Canada and its goal of educating well-rounded graduates, Western’s law school is well positioned to lead the training of students in CSR and the law.
“We are leveraging our business law expertise into a broader range of legal training and ethics, making our students better able to address the issues that may arise in their career,” said W. Iain Scott, dean of the faculty. “Providing them with perspectives on corporate responsibility will draw on many ethical, moral and social questions and train them to more broadly see what is the right thing to do.”
That kind of legal training enables students in business law to engage with those interested in human rights law.
“In my law classes on CSR, students have rigorous and vibrant debates about the obligations of lawyers and a company’s social license to operate,” said Seck. “These conversations give our students a perspective on the many shades of grey that affect corporate decision-making.”
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